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BANCA NAŢIONALĂ A ROMÂNIEI Romanian links with the euro area are material, but the contagion effects from sovereign debt crisis has remained subdued so far… Source: ECB, European Commission, BNR calculations Bloomberg, BNR calculations Importance of the EA for the economy and the banking sector Risk perception (bp), January - mid May 2012 Note: Min, Max, and May-15 values

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BANCA NAŢIONALĂ A ROMÂNIEI …the soundness of the Romanian macroeconomic stance and of the prospects, in line with the region, contributing to such developments Source: Source: European Commission, spring forecast 2012 (May 2012) * projections Main macroeconomic indicators in selected countries

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BANCA NAŢIONALĂ A ROMÂNIEI A slowdown of the EA economic growth would be relatively well managed by the Romanian companies involved in the foreign trade… Source: BNR calculations Main financial soundness indicators for corporate sector, June 2011

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BANCA NAŢIONALĂ A ROMÂNIEI …and an orderly deleveraging process in the EA would orderly impact the SEE region. For Romania, the indirect channel (common lender) marginally changed in 2011, while direct channel is weak Source: BIS, BNR calculations, Fratzscher (2002) Sensitivity of the banking sectors to regional shocks, through common lender channel Average holdings of non-resident government securities by the RO banks Source: monetary survey

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BANCA NAŢIONALĂ A ROMÂNIEI Conclusions A disorderly unfold of the EA sovereign debt crisis would impact Romania through: (i) a deterioration of the availability of funding (through both price and quantitative channels), and (ii) a weakening economic growth prospects. The Romanian banking sector and the companies involved in foreign trade are adequately equipped to withstand external adverse developments. Credit conditions orderly developed in Romania, the central bank taking early measures: (i) calling for additional capital from banks shareholders, (ii) supporting Vienna Initiative type arrangements, and (iii) fostering cooperation with home supervisory authorities. Carrying on prudent policy implementation, in line with EU and IMF arrangements, will continue to provide confidence to the markets and to keep the prudential buffers to adequate levels.